House Price Growth remains robust at 9.7%Make Text Bigger
Despite a predicted last minute rush for Buy to Let Investors to complete purchases before the 3% Stamp duty surcharge comes into force for second property purchases in April, the annual house price growth remained at the same robust level of 9.7%.
However, mortgage approvals did increase by 5% between December and January reflecting the increases demand and pressure to purchase before the Stamp Duty change.
Figures released today in the Halifax Price Index report show:
Prices in the three months to February were 9.7% higher than in the same three months a year earlier.
House prices in the latest three months (December-February) were 3.0% higher than in the preceding three months.
The average house price in the UK according to the Halifax is £209,495 with the rival lender Nationwide claiming £196,930 and a 4.8% increase in house prices this February compared to the same month last year.
Halifax housing economist, Martin Ellis, said “Prices continue to rise at a robust pace driven by a significant imbalance between supply and demand. Whilst this position is likely to continue over the coming months, there are some tentative signs that the supply situation may be beginning to improve. Instructions for secondhand properties coming up for sale have increased in the past two months and the level of housebuilding increased significantly in 2015. Further ahead, increasing affordability issues, as house price increases continue to exceed wage growth, are likely to curb housing demand and cause price growth to ease”
The recent record low levels of housing supply to the market as reported by the (National Association of Estate Agents (NAEA) is likely to continue to drive prices even after the April rush subsides.
The Nationwide’s chief economist, Robert Gardner warned about a ‘marked decline’ in home ownership rates especially in the age group 25 to 34 who were traditionally the age of First Time Buyers with only 37% owning their own home.
Gardner said, “The latest English Housing Survey showed that the proportion of private renters who expect to buy a home at some point in the future declined by four percentage points from 61% to 57% the lowest reading since the survey began in 2008/09. Even amongst those who expect to buy a home, for most this remains a longer term aspiration, with 75% expecting it to take at least two years.”
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